2006-075-RES-LAMAR CO. WATER SUPPLY DISTRICT

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For Phase 2, the Capacity Charge will additionally incorporate the direct assignment to LCWSD of the capital costs reflective of increasing the Maximum Hour Capacity Demand from 395,820 gallons per hour (gph) to 499,980 gallons per hour (gph). Capital costs incurred for increases in Rated Plant Capacity not associated with maintaining the Initial Rated Plant Capacity or not associated with the provision of Treated Water to LCWSD shall not be assigned to LCWSD. Unless mutually agreed upon by the Parties, the Maximum Hour Capacity Demand applied in the Capacity Charge determination will not exceed the Maximum Hour Capacity Demand as provided in Article 2.4 of this Agreement. 5. Water Treatment Plant Demand Charge. Allocation for the Demand Charge for the Treated Water produced by the City for LCWSD from the Water Treatment Plant will be based on the Test Year Maximum Day Metered Demand at the delivery points as identified in Article 2.3, adjusted for lost and unaccounted for water, as provided in Article 2.3, and known and measurable changes. 6. Water Distribution Demand Charge. Allocation for the Demand Charge for Treated Water delivered through the Water Distribution System will be based on the Test Year Distribution Maximum Day Metered Demand, adjusted for known and measurable changes. 7. Water Treatment Plant Volume Charge. Allocation for the Volume Charge for the Treated Water produced by the City for LCWSD from the Water Treatment Plant will be based on the Test Year total water consumption for LCWSD as measured at the delivery points identified in Article 2.3, adjusted for lost and unaccounted for water, as provided in Article 2.3, and known and measurable changes. 8. Water Distribution Volume Charge. Allocation for the Volume Charge for Treated Water delivered through the Water Distribution System will be based on the total water delivered through the Water Distribution System, adjusted for known and measurable changes. d. Review and Update of Cost Methodology. On or before June 1,2010 and every five years thereafter during the tenn of this Agreement, the cost methodologies contained in the Water Rate Study will be reviewed by Paris and LCWSD. The cost methodologies may be modified by agreement of the Pmiies to reflect changed circumstances, change regulatory requirements, and to ensure that Paris is recovering the cost of providing service under this Agreement. If the Parties are unable to reach agreement concerning modification of cost methodologies within one hundred twenty (120) days following the first meeting between the Parties to review such cost 13 Paris/LCWSD Wholesale Treated Water Contract